Trade of the Day: USD/JPY

By: Dima Chernovolov

USD/JPY continues to rise after the price broke the 4-hour Falling Wedge chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of Falling Wedge at the 7-bar level – which is the result of the slow Initial Trend (3 bars), above-average Uniformity (6 bars) and strong Clarity (8 bars). USD/JPY is expected to rise toward the forecast price 104,21 – in line with the earlier upward reversal from the support area shown below.

As can be seen from the daily USD/JPY chart below, the price earlier reversed up with the daily Bullish Engulfing from the key support area lying between the support levels 103,13 and 102,84 – strengthened by the lower daily Bollinger Band. The proximity of this support area and the clear bullish divergence on the daily Stochastic indicator increase the probability USD/JPY will continue to rise toward the forecast price 104,21.